The internet and technology have changed the world. 30 years ago, if you didn't have "a guy" who was a broker or financial planner, you were so far out of the financial world. It was like a foreign entity.

My parents are a great example. They were born in the 40's and all they knew were pensions, Bonds, T-bills and CD's. Their exposure to the Market was only of a place where rich people had their money.

Times have changed. Myself being a Gen-X'er, we have embraced it as so have younger baby boomers too.

The point is, the days of having to have a hard core financial adviser, are very limited. Sure if you've got $5m in assests, complicated businesses, trusts etc, a great financial adviser is worth it to see your overall landscape. But to buy/hold/reinvest dividends long term, high quality information is at our fingertips. It just starts with asking the right questions.

Great read:

Modern Financial Advisers

Big believer in these 5 as well.


What do you guys think and what's your experience? Do you agree?

<---former financial advisor

NOTE: Comments below are not necessarily applicable to guys who solely manage a portfolio for 1% a year.  That's a different skillset, even though there is a lot of overlap.

There are people who are ignorant and don't have the time to learn (or maybe their brain just doesn't grasp it well, despite their talents in other fields).  Those people could benefit from a fee-only financial advisor who makes no $$ from commissions or fees on the sales of products.  That way, they can be assured the advice is not tainted by "I really want to sell you something tasty so I can pay my mortgage." The advisor then can pass them off to someone else who the client can buy their products from.

I think the financial services industry may seriously change over the next decade, based on the Fiduciary Rule and on the greying of the financial services workforce.  IIRC, the average age of a financial services professional is in the early 50s.  Something like 83% of new financial services professional don't survive by the 5-year mark -- as in, they quit the industry entirely and go sell cars or do something else entirely.  Living score-to-score on life insurance commissions, annuity commissions, mutual fund fees can burn people the fuck OUT because of the stress of prospecting and of not making any money for the first 6-12 months.  Moving to financial advising (giving advice as a business for compensation) isn't a "make $100,000 this month!" strategy, but it does make more sense, and I think is better for clients.

ETA:  I agree with much in that article. I have yet to see a financial services company who really trains their sales force on the products or on sales.  Most are mills whose intent is to get that new salesman's list of 100 friends and family, so that after he burns out and leaves they can pass that list to the sales managers who then farm that list for new business.  They get 10 salesmen, 1-2 will survive and the other 8-9 quit in 5 months, no skin off the company's back because those guys are 100% commission anyway.  It's a fucked-up model.

Yeah I agree everytime I hear "commission only" position & make $4500 in your first week .I call bullshit on it and ask the same thing. Whats your skin in it.

Everyone thinks they are the next David Swensen while everything they bought went up